• APAC stocks mostly tracked the gains on Wall St where some of the banking sector jitters dissipated.
• US officials are examining ways to permit the FDIC to temporarily insure deposits beyond the current USD 250k cap on most accounts, according to Bloomberg.
• European equity futures are indicative of a higher open with the Euro Stoxx 50 +0.6% after the cash market closed up 1.3% on Monday.
• DXY is relatively rangebound and on a 103 handle, EUR/USD maintains 1.07 status, antipodeans lag.
• Looking ahead, highlights include German ZEW, Canadian CPI, Retail Sales, US Existing Home Sales, Xi & Putin (2/3), Speeches from ECB's Lagarde & Enria, Supply from UK, Germany & US.

US TRADE

EQUITIES

• US stocks rose amid a more constructive tone in the banking sector in which regional banks in the US saw some reprieve on hopes that the FDIC’s deposit insurance amount could be lifted, or the ceiling abolished, while the Nasdaq-100 relatively underperformed amid another day of losses along the Treasury curve.
• SPX +0.89% at 3,952, NDX +0.34% at 12,563, DJIA +1.2% at 32,245, RUT +1.11% at 1,745
• Click here for a detailed summary.

NOTABLE HEADLINES

• US officials are examining ways to permit the FDIC to temporarily insure deposits beyond the current USD 250k cap on most accounts without the need for congressional approval, according to Bloomberg. There were also earlier reports that the House Freedom Caucus is against raising bank deposit guarantees.
• Federal Loan Home Bank issued USD 304bln in one week as banks bolstered liquidity, according to Bloomberg

APAC TRADE

EQUITIES

• APAC stocks mostly tracked the gains on Wall St where some of the banking sector jitters dissipated following the Credit Suisse rescue and amid hopes FDIC’s deposit insurance amount could be increased.
• ASX 200 was led by outperformance in energy, financials and the mining-related sectors, while the RBA Minutes from the March meeting noted that the Board agreed to reconsider the case for pausing at the April meeting.
• Nikkei 225 was closed as Japanese participants observed the Vernal Equinox holiday.
• Hang Seng and Shanghai Comp. gained as Hong Kong benefitted from strength in consumer stocks and the mainland was buoyed by the PBoC’s liquidity injection albeit with upside capped on higher money market rates.
• US equity futures (ES +0.1%) were steady overnight with price action contained near yesterday's best levels.
• European equity futures are indicative of a higher open with the Euro Stoxx 50 +0.6% after the cash market closed up 1.3% on Monday.

FX

• DXY was rangebound heading into Wednesday’s FOMC decision and languished firmly beneath the 104.00 level amid the positive risk sentiment and after losing ground yesterday to its transatlantic counterparts.
• EUR/USD eased off its highs although held on to the 1.0700 handle and most of the prior day's gains after the Credit Suisse rescue helped soothe some of the banking sector contagion fears in Europe.
• GBP/USD pulled back following the prior day’s outperformance but with the reversal limited ahead of the BoE meeting on Thursday and as money markets price a near coin-flip between a pause and a 25bps hike.
• USD/JPY was confined to within a tight range amid an uneventful dollar and absence of Japanese participants.
• Antipodeans weakened after the RBA Minutes noted that the Board agreed to reconsider the case for pausing at the April meeting and that a pause would allow time to reassess the outlook for the economy, but also reiterated that further tightening of monetary policy is likely required to lower inflation.
• PBoC set USD/CNY mid-point at 6.8763 vs exp. 6.8753 (prev. 6.8694)

FIXED INCOME

• 10yr UST futures mildly rebounded after the prior day’s whipsawing and eventual bear flattening as trade was largely driven by risk sentiment, while the overnight recovery was helped after prices found support around the 115.00 level.
• Bund futures were contained following recent fluctuations and various ECB comments including from Lagarde who reiterated that inflation is projected to remain too high for too long and that without tensions, the ECB would have indicated that further hikes would be needed.

COMMODITIES

• Crude futures marginally retreated overnight albeit with price action contained after yesterday's risk-driven price swings and brief decline in oil futures to their lowest level since December 2021.
• Libyan Oil Minister said if the US congress approves the NOPEC bill, it will lead to destabilisation of the oil market.
• Crude oil exports and transit via Russia's Western ports are set to rise 9% in March M/M, according to Reuters.
• Spot gold traded sideways and took a breather after briefly topping USD 2,000/oz for the first time in a year.
• Copper futures slightly eased off yesterday's highs but with the pullback limited by the constructive mood.

CRYPTO

• Bitcoin marginally extended on gains with price action choppy amid several attempts at the USD 28,000 level.

NOTABLE ASIA-PAC HEADLINES

• White House said the US is in talks with China on potential visits to Beijing by Treasury Secretary Yellen and Commerce Secretary Raimondo.
• China is giving chipmakers new powers to guide a recovery in the industry with a handful of China's most successful chip companies to get easier access to subsidies and more control over state-backed research, according to FT.
• India is considering imposing retaliatory tariffs on European Union exports in response to the bloc’s proposed carbon tax that could disrupt over USD 8bln worth of Indian metal exports to the EU, according to Mint citing sources.
• RBA March Minutes said the Board agreed to reconsider the case for pausing at the April meeting and that a pause would allow time to reassess the outlook for the economy, while it added that further tightening of monetary policy is likely required to lower inflation. RBA noted monetary policy was in restrictive territory and the economic outlook was uncertain, while these considerations meant that it would be appropriate at some point to hold the cash rate steady to assess more fully the effect of the interest rate increases to date. Furthermore, it said inflation is too high, the labour market is tight, business surveys are solid and sluggish productivity could lead to more persistent inflation.

GEOPOLITICS

• Russian Defence Ministry said a Su-35 was scrambled over the Baltic Sea on Monday as 2 US bombers approached the Russian border and then left, according to Reuters citing a telegram.
• Chinese President Xi said China will continue to play a constructive role in promoting a political settlement of the Ukraine crisis, while President Xi told Russian President Putin that ties with Russia are China's strategic choice.
• Iran is interested in developing peaceful nuclear and renewable energy cooperation with Russia, according to RIA.
• Japanese PM Kishida said he will visit Kyiv and meet with Ukrainian President Zelensky, according to NHK. It was later reported that Japan's Ministry of Foreign Affairs said Japan and Ukraine leaders will hold a summit today.
• South Korea imposed sanctions on four individuals and six entities linked to North Korea's weapons programmes, while it announced a watch list to ban the export of items related to North Korea's satellite development, according to Reuters.

EU/UK

• The Times shadow monetary policy committee urges the BoE to continue raising interest rates this week. Two members said the Bank should stick to 50bps, five said 25bps and one said unchanged.
• ECB's Kazaks said uncertainty in financial markets is high and it is not possible to say that we have stopped hiking, while he added that European banks are well capitalised and financial resources are available, according to Bloomberg
• French Government narrowly survived a no-confidence vote in parliament and was 9 votes short of no-confidence.